Rent Vs Buy – What Lifestyle Can I Afford?
1. Rent or Mortgage
The decision to rent or buy is a big one that depends on your financial situation and goals. Don’t listen to people who say buying always makes more sense in the long run or that you’re throwing money away by renting.
The general rule of thumb is that you shouldn’t spend more than 30% of your gross income on housing. That’s a recommendation that dates back to national public housing regulations passed in 1969.
However, you need to factor in other costs, like furniture and utilities, when determining your budget. This can make the 30% rule seem unrealistic, especially at higher income levels.